Irish incumbent telco Eircom has hired Rothschild to consider listing on a public market in a move that could value it at more than €2bn (US$2.8bn).
The group is carrying out a strategic review shortly after extending around €2bn of senior loans by…
Irish incumbent telco Eircom has hired Rothschild to consider listing on a public market in a move that could value it at more than €2bn (US$2.8bn).
The group is carrying out a strategic review shortly after extending around €2bn of senior loans by two years to September 2019, making it a more attractive target to investors.
“Following the successful outcome of the A&E process, the board is now exploring a number of options with a view to further strengthening the financial position of the group,” it said.
An IPO would be the third time Eircom has listed in 15 years. It was taken private two years after its first float in 1999, and was later brought back to the market in 2004 only to be taken private again two years later.
In 2012 the telco was taken over by its bondholders after it fell into an administration process called examinership.
Hong Kong-based conglomerate Hutchison Whampoa had tried to acquire the group during this restructuring process with a €2bn offer that was rejected by Grant Thornton, Eircom’s court-appointed examiner.
The next year Hutchison agreed a €850m deal to acquire O2 Ireland from Spain’s Telefonica. It is still awaiting approval from the European Commission for that transaction, which requires remedies because Hutchison already owns mobile operator Three in the country.
Local reports suggest Eircom’s owners could be tempted to offload the asset in a quick-fire trade sale before IPO plans advance significantly.
One company that could potentially be interested in the group is Irish cableco UPC, which is owned by Liberty Global.
As part of remedies understood to have been put forward by Hutchison for its O2 Ireland deal, UPC could be in line for an MVNO that will get the option for its own spectrum.
UPC is thought to have sought an MVNO in the past to offer bundled services to consumers.
The companies declined to comment.
If Eircom achieves a sale of more than €1.8bn, the telco’s top management are reportedly in line for 10% of the increase above that level. They are also set for bonuses on the pay down of senior debt under the management incentive scheme, reported the Irish Independent.
